Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
Jack Clancy has been the CEO of Enterprise Bancorp, Inc. (NASDAQ:EBTC) since 2007. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Jack Clancy's Compensation Compare With Similar Sized Companies?
Our data indicates that Enterprise Bancorp, Inc. is worth US$333m, and total annual CEO compensation is US$1.0m. (This figure is for the year to December 2018). That's less than last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$489k. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO total compensation was US$1.8m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
The graphic below shows how CEO compensation at Enterprise Bancorp has changed from year to year.
Is Enterprise Bancorp, Inc. Growing?
Enterprise Bancorp, Inc. has increased its earnings per share (EPS) by an average of 14% a year, over the last three years (using a line of best fit). It achieved revenue growth of 8.5% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Enterprise Bancorp, Inc. Been A Good Investment?
Enterprise Bancorp, Inc. has served shareholders reasonably well, with a total return of 19% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
It looks like Enterprise Bancorp, Inc. pays its CEO less than similar sized companies. Since the business is growing, many would argue this suggests the pay is modest. The total shareholder return might not be amazing, but that doesn't mean that Jack Clancy is paid too much.
Few would complain about reasonable CEO remuneration when the business is growing earnings per share. But it would be nice if insiders were also buying shares. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Enterprise Bancorp.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.